Amazon Fresh reportedly shutting down neighborhoods in up to five states

The end of cheap credit means Amazon can't keep expending money like water. I wonder what others things they will close down?

Feds aren't going to hike the rates by a ton, and markets are efficient enough that the incoming rate hike is already accounted for by credit markets. Also, Amazon is (barely) profitable. They won't be able to expand without credit, but they also won't need to close any businesses down.

Even the more or less 1% anual we got so far is a lot of money for companies like Amazon that waste billions like nothing.

Secondly, bonds typically have set maturities and coupon rates. Most existing loans won't become more expensive to service.

Maybe they'd have to slow their expansion. But given that they had $64 billion liabilities and $3.8 EBIT, even if the debts do become 1% more expensive to service (they won't do it instantly anyway, instead their debts would become more expensive gradually over years and decades as they have to replace current bonds with new ones) they're still fine.

my guess is that the affected areas were simply not profitable enough for Amazon to continue offering the service.

And this is the problem with letting Amazon crush brick and mortar. It's like the Walmart comes into a small town and the little businesses get slaughtered, except instead of being left with a monolithic human garbage dump with more variety, you can just be left with nothing.

Further, unlike Walmart which employs 100s/1000s at substandard wages, Amazon's entire goal is to unemploy as many as possible with robots.

Can I ask which city? I'm in Lynn. There is a Whole Foods just down the street in Swampscott. I don't get it.

Somerville here, and I didn't get a message. Though I have never actually used Fresh since signing up for the trial; every time I consider it, I can't get to the minimum order because so much is out of stock.

We had their service and it was decent. We occassionally had missing items but they were quick to refund. It was rare enough I didn't mind it. They had lots of delivery times too. Overall, we found the quality to be much better than Instacart, which is often very inconsistent in quality and service. Sadly, they kept jacking up the minimum order amount with no notice. After it hit $50, it just wasn't worth it anymore. I can't help but wonder if the manpower for delivery was just too high. Roughly, 75% of the time a postal employee made our deliveries.

Prime Now does a lot of grocery staples with a lower minimum order so we still use it when it works out. Sadly, it's back to Instacart and their mediocre service for the rest of our orders.

my guess is that the affected areas were simply not profitable enough for Amazon to continue offering the service.

And this is the problem with letting Amazon crush brick and mortar. It's like the Walmart comes into a small town and the little businesses get slaughtered, except instead of being left with a monolithic human garbage dump with more variety, you can just be left with nothing.

Further, unlike Walmart which employs 100s/1000s at substandard wages, Amazon's entire goal is to unemploy as many as possible with robots.

Give WalMart time, they will get there too with self-service kiosks and other forms of automation.

The end of cheap credit means Amazon can't keep expending money like water. I wonder what others things they will close down?

Feds aren't going to hike the rates by a ton, and markets are efficient enough that the incoming rate hike is already accounted for by credit markets. Also, Amazon is (barely) profitable. They won't be able to expand without credit, but they also won't need to close any businesses down.

Even the more or less 1% anual we got so far is a lot of money for companies like Amazon that waste billions like nothing.

Secondly, bonds typically have set maturities and coupon rates. Most existing loans won't become more expensive to service.

Maybe they'd have to slow their expansion. But given that they had $64 billion liabilities and $3.8 EBIT, even if the debts do become 1% more expensive to service (they won't do it instantly anyway, instead their debts would become more expensive gradually over years and decades as they have to replace current bonds with new ones) they're still fine.

The end of cheap credit means Amazon can't keep expending money like water. I wonder what others things they will close down?

Feds aren't going to hike the rates by a ton, and markets are efficient enough that the incoming rate hike is already accounted for by credit markets. Also, Amazon is (barely) profitable. They won't be able to expand without credit, but they also won't need to close any businesses down.

Even the more or less 1% anual we got so far is a lot of money for companies like Amazon that waste billions like nothing.

Secondly, bonds typically have set maturities and coupon rates. Most existing loans won't become more expensive to service.

Maybe they'd have to slow their expansion. But given that they had $64 billion liabilities and $3.8 EBIT, even if the debts do become 1% more expensive to service (they won't do it instantly anyway, instead their debts would become more expensive gradually over years and decades as they have to replace current bonds with new ones) they're still fine.

Yeah yeah that's the federal funds rate, which is correlated to corporate interest rates but isn't the same thing. Federal funds rate is simply the interbank overnight landing rate, similar to the IBOR in other countries. Some countries like the UK or Singapore let the market determine the rate (LIBOR and SIBOR, respectively) instead of setting it like the US.

Please actually learn how credit markets work before ranting. Long periods of low interest rates are causing problems, but not the kind of problems you're suggesting.

30% premium? Prime Fresh was roughly 20% cheaper than grocery store I shop at, and I certainly don't shop at a high-end grocery store. Some things sometimes cost more, but whenever I directly compared a large receipt against an equivalent order from Fresh, Fresh was significantly cheaper.

You’re not buying from third parties via Fresh. Third party sellers are paying a 35% vig to Amazon, and that comes from your pocket. And I flat out don’t believe 20% less unless you have selective observation cherry picking loss leaders because the entire grocery retail industry operates on gross margins of less than 10%.

It seems like the entire grocery delivery idea is swimming against the current. Despite the fact that a great deal of shopping has switched to online from one's couch, grocery shopping still seems to be something that people seem to prefer. It's a place to be seen, and unlike a lot of stores which cater to specific desires, everyone goes to the grocery store. I look forward to the progress of Amazon Go, but it seems as though society is just not interested in this yet.

No. It's just harder to delegate some things. I started using the Walmart pickup service because I couldn't reasonably delegate my own shopping to a caregiver. Even that's hit or miss when it comes to produce. I'm much better off selecting that stuff myself.

I also tried Amazon pantry. They managed to dent metal cans. Amazon fresh was just a non-starter. Totally horrible selection.

Still keep the couriers busy with all the stuff Amazon can do well with though.

my guess is that the affected areas were simply not profitable enough for Amazon to continue offering the service.

And this is the problem with letting Amazon crush brick and mortar. It's like the Walmart comes into a small town and the little businesses get slaughtered, except instead of being left with a monolithic human garbage dump with more variety, you can just be left with nothing.

Further, unlike Walmart which employs 100s/1000s at substandard wages, Amazon's entire goal is to unemploy as many as possible with robots.

People are so cute when they try to pretend that Amazon is unstoppable.

Grocery is pretty much the big fat fail for me and I'm an Amazon junkie. I'm very much one of those "if I could, I would types". It's just not happening. I would be forced to make far too many compromises and that's something I'm not willing to do. Amazon crushes B&M primarily because of selection. Price and convenience are distant secondary advantages.

my guess is that the affected areas were simply not profitable enough for Amazon to continue offering the service.

And this is the problem with letting Amazon crush brick and mortar. It's like the Walmart comes into a small town and the little businesses get slaughtered, except instead of being left with a monolithic human garbage dump with more variety, you can just be left with nothing.

Further, unlike Walmart which employs 100s/1000s at substandard wages, Amazon's entire goal is to unemploy as many as possible with robots.

Give WalMart time, they will get there too with self-service kiosks and other forms of automation.

Walmart already has a very good pickup service.

Their website is surprisingly good and has a better interface than Amazon when it comes to grocery items.

Heavy milk containers, and similar items, were packed on top of tomatoes and other softer foods. Much of the "fresh" items, including produce, was frozen, bruised, etc.

It also took them three weeks to pick up the empty delivery totes.Great idea. Terrible execution.

Exactly our experience. We also found that items like bananas had been packed directly touching freezer packs, burning then. All in all, we'd find about 1/4 of our order was ruined for various reasons. Refunds were quick, but that's still a hassle.

I tried grocery delivery services back in the day and found the problem was nearly expired foods as well as packing issues. So I've not been even remotely tempted to try Amazon Fresh. I didn't think it would work out any better than the other tries at this, in both execution and concept.

I'd rather pick it out and pack it myself. At least that way, I know exactly what I'm getting BEFORE they come to my door.

From the sound of it, they're going to experience the same thing the other grocery delivery services did: A poor reputation.

I use a major supermarket chain in Australia and I think I know where all the checkout folks have gone now that self checkouts are a thing, packing deliveries.

Granted, right now the two major supermarkets are trying to "win" home delivery, so I get free delivery and everything is perfect. But everything is packed logically like a bagging clerk would do, it usually comes in 3 or 4 plastic crates that they wheel straight up to the door. Usually I get my fruit/veggies in one crate, meat/dairy in another, heavy items always on the bottom.

Never had one squashed item and it tends to be better quality than if I picked it myself. However one thing to remember is that the crap produce on shelves in stores is usually due to people handling it, if they grab it prior to that it's going to naturally be a lot better.

Can I ask which city? I'm in Lynn. There is a Whole Foods just down the street in Swampscott. I don't get it.

Somerville here, and I didn't get a message. Though I have never actually used Fresh since signing up for the trial; every time I consider it, I can't get to the minimum order because so much is out of stock.

I've had this problem. I mainly use Fresh to order cases of water. They will bring them up to my third floor apartment.